INDIANAPOLIS — Several Hoosier families are preparing to celebrate the rollout of the advance Child Tax Credit payments, which are set to start July 15.
Payments of up to $300 per month per child will continue through December 15. This applies to families with kids up to 17 years old.
Made possible through the American Rescue Plan, the payments are meant to help families with child care expenses.
Mother and Hoosier Action member, LaToya Tahirou, says this is a game changer as it brings immediate relief to struggling households.
“When you think about families and parents just so burdened and bogged down by financial strain, how do they show up for their children? So decreasing some of that financial strain, alleviating some of that stress, will allow families to be able to pay bills and maybe even have some room for some wants they may never have the opportunity to get.”
To celebrate the change, Hoosier Action is hosting a picnic and parade at University Park (307 N. Meridian Street) at noon. The event includes speakers, family activities and food. The event closes with the parade ending at Senator Todd Young’s office.
Organizers say the goal is to hopefully make the change permanent.
However, Sherry Borshoff, president of local tax consulting firm, Borshoff Consulting, says it’s unlikely to happen.
“I don’t really think that the government can sustain giving out money in advance for a long, long period of time,” she said. “This was put into place because of the impact that COVID had on the economy, and on American families, who maybe lost their jobs and they’re trying to catch back up from maybe six months of unemployment and those kinds of things. So this is something that Congress had enacted in order to rescue the American families.”
Borshoff says families can opt out of the monthly payments, which has been her advice to most clients, if they can afford to do it.
“It just kind of really comes down to what you need right now though,” Borshoff added. “If you need to have your children taken care of, and you need some help with getting them taken care of, then that’s a good thing, but if not, then you know… most taxpayers, I would say, prefer to wait until tax filing season and take the credits then.”
“I think, come 2021 filing season, there may be a lot of people who are actually unpleasantly surprised at what their refund is going to look like because that’s typically one of the bigger tax credits that families can get, especially if they have several children that have to have either daycare or after school care,” she said.
As far as how to get your payments, Borshoff says you’re automatically enrolled if you filed and claimed a child tax credit on your 2019 or 2020 tax return.
When it comes to potentially owing some of the money back, Borshoff says it’s possible, depending on the circumstance, but it’s not clear.
“We haven’t gotten any real guidance yet, as to if you get more than you were supposed to get,” said Borshoff. “There could be something come 2021 tax filing season, in 2022, that they might claw back some of that money. They might not, but they might.”
For more information, or to opt out of the monthly tax credit payments, you can visit the IRS website.